{"operation":"document","citation":"CPF 420171011","title":"AIR PRODUCTS & CHEMICALS INC — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2017-08-24","effective_on":null,"summary":"CLOSED notice of probable violation citing 192.805(b), 192.917(b), 192.917(c), 192.935(c).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-420171011.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-420171011.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-420171011","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/420171011","body":"Notice of Probable Violation involving AIR PRODUCTS & CHEMICALS INC. PHMSA's enforcement data identifies the cited regulations as 192.805(b),  192.917(b),  192.917(c),  192.935(c). The case was opened on 2017-08-24 and is reported as closed as of 2018-10-16. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n420171011_Closure Letter_10162018.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420171011/420171011_Closure%20Letter_10162018.pdf\n\n420171011_Closure Letter_10162018_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420171011/420171011_Closure%20Letter_10162018_text.pdf\n\n420171011_Final Order_04052018.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420171011/420171011_Final%20Order_04052018.pdf\n\n420171011_Final Order_04052018_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420171011/420171011_Final%20Order_04052018_text.pdf\n\n420171011_NOPV PCO_08242017.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420171011/420171011_NOPV%20PCO_08242017.pdf\n\n420171011_NOPV PCO_08242017_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420171011/420171011_NOPV%20PCO_08242017_text.pdf\n\n420171011_Final Order_04052018_text.pdf\n\nApril 5, 2018\nMr. Seifi Ghasemi\nPresident and Chief Executive Officer\nAir Products & Chemicals, Inc.\n7201 Hamilton Blvd\nAllentown, Pennsylvania 18195\nRe: CPF No. 4-2017-1011\nDear Mr. Ghasemi:\nEnclosed please find the Final Order issued in the above-referenced case. It makes findings of\nviolation and specifies actions that need to be taken by Air Products & Chemicals, Inc., to\ncomply with the pipeline safety regulations. When the terms of the compliance order have been\ncompleted, as determined by the Director, Southwest Region, this enforcement action will be\nclosed. Service of the Final Order by certified mail is effective upon the date of mailing as\nprovided under 49 C.F.R. § 190.5.\nThank you for your cooperation in this matter.\nSincerely,\nAlan K. Mayberry\nAssociate Administrator\nfor Pipeline Safety\nEnclosure\ncc: Director, Southwest Region, Office of Pipeline Safety, PHMSA\nMs. Marie Ffolkes, President – Industrial Gas America, Air Products & Chemicals, Inc.\nCERTIFIED MAIL - RETURN RECEIPT REQUESTED\n\n\n\nU.S. DEPARTMENT OF TRANSPORTATION\nPIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION\nOFFICE OF PIPELINE SAFETY\nWASHINGTON, D.C. 20590\n____________________________________\nIn the Matter of )\nAir Products & Chemicals, Inc., ) CPF No. 4-2017-1011\n)\n)\n)\nRespondent. )\n____________________________________)\nFINAL ORDER\nFrom January through June, 2017, pursuant to 49 U.S.C. § 60117, representatives of the Pipeline\nand Hazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety (OPS),\nconducted an on-site pipeline safety inspection of the facilities and records of Air Products &\nChemicals, Inc. (Air Products or Respondent), in Texas and Louisiana. Air Products conducts\noperations in 50 countries worldwide, and serves customers across a wide range of industries\nfrom food and beverage to medical, energy, and transportation. Air Products’ Gulf Coast\nPipeline System consists of an approximately 535-mile onshore hydrogen gas transmission\npipeline.1\nAs a result of the inspection, the Acting Director, Southwest Region, OPS (Director), issued to\nRespondent, by letter dated August 24, 2017, a Notice of Probable Violation and Proposed\nCompliance Order (Notice), which also included a warning pursuant to 49 C.F.R. § 190.205. In\naccordance with 49 C.F.R. § 190.207, the Notice proposed finding that Air Products had violated\n49 C.F.R. §§ 192.935 and 192.917 and proposed ordering Respondent to take certain measures to\ncorrect the alleged violations. The warning item required no further action but warned Air\nProducts to correct the probable violation or face possible future enforcement action.\nAir Products responded to the Notice by letter dated September 8, 2017, and requested the case\nfile and a 180-day extension to respond the Notice. PHMSA sent the case file to Air Products\nvia e-mail on September 8, 2017. On September 26, 2017, PHMSA approved Air Products’\nrequest to extend the deadline for a response to the Notice until October 30, 2017. On October\n30, 2017, Air Products responded to the Notice by letter (Response), and elected not to contest\nthe violations alleged in the Notice, but requested an additional six months following the\nissuance of a Final Order to complete Item 2 of the Proposed Compliance Order. On November\n2, 2017, PHMSA issued a Region Recommendation requesting that a Final Order be issued with\na Compliance Order, as written in the Notice, except that Air Products be granted 180 days from\n1 http://www.airproducts.com/ (last visited January 24, 2018).\n\n\n\nCPF No. 4-2017-1011\nPage 2\nthe date of issuance of the Final Order to complete Item 2 of the Proposed Compliance Order.\nRespondent did not request a hearing and therefore has waived its right to one.\nFINDINGS OF VIOLATION\nIn its Response, Air Products did not contest the allegations in the Notice that it violated\n49 C.F.R. Part 192, as follows:\nItem 2: The Notice alleged that Respondent violated 49 C.F.R. § 192.935(c), which states:\n§ 192.935 What additional preventive and mitigative measures must\nan operator take?\n(a) …\n(c) Automatic shut-off valves (ASV) or Remote control valves (RCV). If\nan operator determines, based on a risk analysis, that an ASV or RCV would\nbe an efficient means of adding protection to a high consequence area in the\nevent of a gas release, an operator must install the ASV or RCV. In making\nthat determination, an operator must, at least, consider the following\nfactors--swiftness of leak detection and pipe shutdown capabilities, the type\nof gas being transported, operating pressure, the rate of potential release,\npipeline profile, the potential for ignition, and location of nearest response\npersonnel.\nThe Notice alleged that Respondent violated 49 C.F.R. § 192.935(c) by failing to perform an\nadequate risk analysis to determine whether an ASV or RCV would be an efficient means of\nadding protection to a high consequence area (HCA) in the event of a gas release. Specifically,\nthe Notice alleged that Air Products failed to undertake a detailed risk analysis that took into\naccount the impact of risk on newly identified covered segments to determine whether ASVs or\nRCAs would be appropriate. On the contrary, the Notice alleged that Air Products informed the\nPHMSA inspector that Air Products had determined that ASVs and RCVs would not add\nprotection but would merely reduce the duration of a release. Further, Air Products stated that\nthe use of ASVs/RCVs would not significantly reduce the damage impact of a pipeline rupture or\nprovide an efficient means of additional safety in HCAs. According to the Notice, Air Products\nprovided the inspector with a draft Integrity Management Program (IMP) Procedure 34-0763:\nPipeline Integrity Management Program Preventative and Mitigative Measures Plan Protocol\nH. Section 5.2.6.3 of this procedure allegedly supported Air Products’ engineering decision for\nhydrogen and Syngas products based on an American Gas Association White Paper (3/25/2011).\nUpon review of this information, PHMSA concluded that Air Products had failed to adequately\nanalyze and evaluate the need for RCV and ASV locations to determine if they would mitigate or\nenhance public safety in each HCA segment, as required by the 49 C.F.R. § 192.935. According\nto the Notice, Air Products did not conduct an analysis that considered the swiftness of leak\ndetection and pipe shutdown capabilities, the type of gas being transported, the operating\npressure, the rate of potential release, the pipeline profile, the potential for ignition, or the\nlocation of the nearest response personnel. In addition, the Notice alleged that Air Products\nfailed to consider the factors beyond immediate injury, such as prolonged flame exposure to\n\n\n\nCPF No. 4-2017-1011\nPage 3\nemergency responders and the public, the danger to people caught in difficult-to-evacuate areas,\nthe impact on key transportation corridors, or the risk of wildfires.\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find that Respondent violated 49 C.F.R. § 192.935(c) by failing to perform an\nadequate risk analysis to determine whether an ASV or RCV would be an efficient means of\nadding protection to an HCA in the event of a gas release.\nItem 3: The Notice alleged that Respondent violated 49 C.F.R. § 192.917, which states, in\nrelevant part:\n§ 192.917 How does an operator identify potential threats to pipeline\nintegrity and use the threat identification in its integrity program?\n(a) …\n(b) Data gathering and integration. To identify and evaluate the\npotential threats to a covered pipeline segment, an operator must gather and\nintegrate existing data and information on the entire pipeline that could be\nrelevant to the covered segment. In performing this data gathering and\nintegration, an operator must follow the requirements in ASME/ANSI\nB31.8S, section 4. At a minimum, an operator must gather and evaluate the\nset of data specified in Appendix A to ASME/ANSI B31.8S, and consider\nboth on the covered segment and similar non-covered segments, past\nincident history, corrosion control records, continuing surveillance records,\npatrolling records, maintenance history, internal inspection records and all\nother conditions specific to each pipeline.\n(c) Risk assessment. An operator must conduct a risk assessment that\nfollows ASME/ANSI B31.8S, section 5, and considers the identified threats\nfor each covered segment. An operator must use the risk assessment to\nprioritize the covered segments for the baseline and continual reassessments\n(§§ 192.919, 192.921, 192.937), and to determine what additional\npreventive and mitigative measures are needed (§ 192.935) for the covered\nsegment.\nThe Notice alleged that Respondent violated 49 C.F.R. § 192.917(b-c), by failing to identify and\nevaluate the potential threats to covered pipeline segments by gathering and integrating existing\ndata and information on the entire pipeline that could be relevant to the covered segments. In\naddition, the Notice alleged that Air Products did not follow its own pipeline IMP, “Threat\nIdentification Data Integration and Risk Assessment Plan - Protocol C, 34-0758, Rev 0.”\nSpecifically, it alleged that Air Products used the Dynamic Risk Assessment Systems, Inc.\n(DRAS) common risk model in its IMP to perform only a minimal risk analysis. Air Products,\nhowever, allegedly did not use an adequate or appropriate process to input data and information\ninto its risk analysis process or to confirm that its output data was accurate. Upon questioning by\nPHMSA inspectors, Air Products could not explain certain risk calculations in its risk model.\nPHMSA inspectors also identified several instances of missing or incorrect input data in Air\nProducts’ risk models used to assess specific risks to the pipeline. Finally, Air Products also\n\n\n\nCPF No. 4-2017-1011\nPage 4\nstated to PHMSA inspectors that several factors in its risk model were inactive, which called into\nquestion the accuracy of the input data and risk-factor calculations.\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find that Respondent violated 49 C.F.R. § 192.917 by failing to identify and\nevaluate the potential threats to covered pipeline segments by gathering and integrating existing\ndata and information on the entire pipeline that could be relevant to the covered segments.\nThese findings of violation will be considered prior offenses in any subsequent enforcement\naction taken against Respondent.\nCOMPLIANCE ORDER\nThe Notice proposed a compliance order with respect to Items 2, and 3 in the Notice for\nviolations of 49 C.F.R. §§ 192.935(c), and 192.917, respectively. Under 49 U.S.C. § 60118(a),\neach person who engages in the transportation of gas or who owns or operates a pipeline facility\nis required to comply with the applicable safety standards established under chapter 601.\nPursuant to the authority of 49 U.S.C. § 60118(b) and 49 C.F.R. § 190.217, Respondent is\nordered to take the following actions to ensure compliance with the pipeline safety regulations\napplicable to its operations:\n1. With respect to the violation of § 192.935(c) (Item 2), Respondent must:\na. b. c. Perform a study to analyze and evaluate the need for RCV and ASV locations\nto determine if they would mitigate or enhance public safety in each HCA\nsegment;\nThe study must consider factors beyond immediate injury, such as: prolonged\nflame exposure to emergency responders and public; danger to people caught\nin difficult-to-evacuate areas; impacts on key transportation corridors; and the\nrisk of wildfires; and\nComplete and submit the written study to the Director, for review and\napproval, within six months of the date of this Final Order.\n2. With respect to the violation of § 192.917 (Item 3), Respondent must:\na. b. c. Ensure that all input and output data of the Risk Model used in its IMP is accurate\nfor all pipelines that impact an HCA;\nEnsure its risk rankings are logical and consistent with industry practice; and\nComplete these requirements and submit the updated Risk Model to the\nDirector, for review and approval, within 180 days of the date of this Final\nOrder.\nThe Director may grant an extension of time to comply with any of the required items upon a\nwritten request timely submitted by the Respondent and demonstrating good cause for an\nextension.\n\n\n\nCPF No. 4-2017-1011\nPage 5\nIt is requested (not mandated) that Respondent maintain documentation of the safety\nimprovement costs associated with fulfilling this Compliance Order and submit the total to the\nDirector. It is requested that these costs be reported in two categories: (1) total cost associated\nwith preparation/revision of plans, procedures, studies and analyses; and (2) total cost associated\nwith replacements, additions and other changes to pipeline infrastructure.\nFailure to comply with this Order may result in the administrative assessment of civil penalties\nnot to exceed $200,000, as adjusted for inflation (49 C.F.R. § 190.223), for each violation for\neach day the violation continues or in referral to the Attorney General for appropriate relief in a\ndistrict court of the United States.\nWARNING ITEM\nWith respect to Item 1, the Notice alleged probable violations of 49 C.F.R. § 192.805(b), but did\nnot propose a civil penalty or compliance order for this item. Therefore, this is considered to be\na warning item. The warning was for:\n49 C.F.R. § 192.805(b) (Item 1) ─ Respondent’s alleged failure to ensure through\nevaluation that an employee was qualified to perform a covered task.\nPHMSA representatives reviewed the circumstances and supporting documents involved in\nItem 1 and determined that additional enforcement action or penalty assessment proceedings was not\nwarranted at this time. If OPS finds a violation of this provision in a subsequent inspection,\nRespondent may be subject to future enforcement action.\nUnder 49 C.F.R. § 190.243, Respondent may submit a Petition for Reconsideration of this Final\nOrder to the Associate Administrator, Office of Pipeline Safety, PHMSA, 1200 New Jersey\nAvenue, SE, East Building, 2nd Floor, Washington, DC 20590, with a copy sent to the Office of\nChief Counsel, PHMSA, at the same address, no later than 20 days after receipt of service of this\nFinal Order by Respondent. Any petition submitted must contain a statement of the issue(s) and\nmeet all other requirements of 49 C.F.R. § 190.243. The terms of the order, including corrective\naction, remain in effect unless the Associate Administrator, upon request, grants a stay. The\nterms and conditions of this Final Order are effective upon service in accordance with 49 C.F.R.\n§ 190.5.\nApril 5, 2018\n___________________________________ __________________________\nAlan K. Mayberry Date Issued\nAssociate Administrator\nfor Pipeline Safety\n\n420171011_Closure Letter_10162018_text.pdf\n\nCERTIFIED MAIL - RETURN RECEIPT REQUESTED\nOctober 16, 2018\nMarie Ffolkes\nPresident – Industrial Gas America\nAir Products & Chemicals Inc.\n7201 Hamilton Blvd.\nAllentown, Pennsylvania 18195\nCPF 4-2017-1011\nDear Ms. Ffolkes:\nOn April 5, 2018, the Pipeline and Hazardous Materials Safety Administration (PHMSA) issued\nto Air Products & Chemicals Inc. a Final Order in the above-referenced case. This Order included\na Compliance Order. Based on our review of the documentation you provided, it has been\ndetermined that you have complied with the terms of this Order.\nAccordingly, this case is now closed and no further action is contemplated with respect to the\nmatters involved in this case. Thank you for your cooperation in this matter.\nSincerely,\nMary L. McDaniel, P.E.\nDirector, Southwest Region\nOffice of Pipeline Safety\nPipeline and Hazardous Materials Safety Administration","truncated":false,"body_characters":17042}